[extropy-chat] how sleep deprivation skews perception

Sean Diggins sean at valuationpartners.com.au
Tue Oct 26 08:06:55 UTC 2004


 -----Original Message-----
From: extropy-chat-bounces at lists.extropy.org
[mailto:extropy-chat-bounces at lists.extropy.org] On Behalf Of Mike Lorrey
> From: Mike Lorrey
> 
> As I've said before: if a nation fails to develop (running water,
> among
> other things) it is because that nation fails to or refuses to
> establish institutions that protect private property rights. It is no
> fault of ours.
> 
> -----------------------------------------
> You really ARE a true libertarian Mike. No grey/gray areas for you.
> It's ALL clear as day.
> That last sentence....what a wonderful thing to be able to say that
> to the mirror each morning.
> I'm with you, Mike.  

You're not that good at sarcasm, Sean, any more than Penn is. 

---------------------------------

Never claimed to be good at it. Normally, on the internet, I studiously
avoid it. But you deliberately cursed my presence on this list, likening me
to Kudzu. Not a good way to engage me, when all I ask for is a discourse I
can learn from. But the word "ours" set me off, Mike. Just who do you mean?
Do you mean anyone NOT within the nation lacking the ability to provide
basic needs? Or do you mean other libertarians? Or just people on this list?
At the end of the day, you seem to be suggesting humanity has no collective
duty of care. This is one element of libertarianism which I reject. Maybe
I'm just reading your sentence badly, but to me, it doesn’t matter where the
blame lies. I sure hope "it's not my fault" is not an attitude which
survives The Spike, singularity or whatever leads into post-humanism. 

----------------------------------
> 
> Third world thugs would rather spend their meager resources, and
> whatever aid they can beg, borrow, or steal, for weaponry and more
> thuggish underlings, to subject their citizens and expand their
> tyranny. Typically this is with the assistance of so-called
> 'liberation' forces backed by socialist/communist causes.
> 
> --------------------------------------------
> 
> And you, as a wise, informed "Vice Chair" (still one rung to go eh?)
> have personally witnessed this "backing by socialist/communist
> causes"?

You are new here, so I won't get ticked at your ignorance.
--------------------------------

I don’t post much, true. But I have lurked here since May. There are 3772
extropian posts in my Inbox. I've read most of them, in various states of
sleep deprivation. 
But you are correct, I don’t know your personal history. That's why I asked.
I should not have prefixed the question with a sneer at the contents of your
signature. I'm sure you have good reason for decaring your "rank" and I
apologies for the sneer. It was reactive.
But I would like to know the sources and evidence for all your claims.
Educate me.

-----------------------------------

> But somehow, during your travels, you missed all the backing by
> manifestly corrupt, cynical capitalist administrations of various
> western democracies?

What makes you think they are capitalist administrations? Most of the
western democracies are quite socialized, even most of the US. The US
as a whole is not capitalist, it is mercantilist.

------------------------------------------

OK. Please explain to me where one ends and the other begins with respect to
the US, particularly with respect to the global tentacles the US has wrapped
around much of the planet. Mercantilism is as dated and outmoded as the
communism and socialism you originally accused me of waving around in here.
Globalisation, corporatisation - these two terms alone are more interesting
to dissect in the context of this discussion. 
And if most of the capitalist administrations have become quite socialist in
your view, which capitalist systems are left functioning? I'm quite confused
regarding your views on this.

All I have time for now...

But once again, at the risk of being redundant, are you prepared to dissect
the machinations behind the piece I posted from Naomi Klein?
No one on this list made any comments.

The article is re-posted below.

Thanks...and I'll suspend any attempts to out-sneer you if you'd please
educate me rather than belittle me.
I'm here to learn, not trade insults or be publicly humiliated.

Sean



http://www.guardian.co.uk/weekend/story/0,3605,1125050,00.html

The Guardian

Saturday January 17, 2004

The $500 billion fire sale

In a shattered postwar Iraq, there are rich pickings to be had - and for
US businesses at least, it promises to be a risk-free bonanza. Naomi
Klein joins those at a trade show jostling for a stake

By Naomi Klein

It's 8.40am, and the Sheraton Hotel ballroom thunders with the sound of
plastic explosives pounding against metal. No, this is not the Sheraton
in Baghdad, it's the one in Arlington, Virginia. And it's not a real
terrorist attack, it's a hypothetical one. The screen at the front of
the room is playing an advertisement for "bomb-resistant waste
receptacles" - this trash can is so strong, we're told, it can contain a
C4 blast. And its manufacturer is convinced that, given half a chance,
these babies would sell like hot cakes in Baghdad - at bus stations,
army barracks and, yes, upscale hotels. Available in Hunter Green,
Fortuneberry Purple and Windswept Copper.



This is ReBuilding Iraq 2, a gathering of 400 businesspeople itching to
get a piece of the Iraqi reconstruction action. They're here to meet
those doling out the cash, in particular the $18.6bn in contracts to be
awarded in the next two months to companies from "coalition partner"
countries. The people to meet are from the Coalition Provisional
Authority (CPA), its new programme management office, the Army Corps of
Engineers, the US Agency for International Development, Halliburton,
Bechtel and members of Iraq's interim governing council. All these
players are on the conference programme, and delegates have been
promised that they'll get a chance to corner them at regular "networking
breaks".



There have been dozens of similar trade shows on the business
opportunities created by Iraq's decimation, in hotels from London to
Amman. By all accounts, the early conferences throbbed with the sort of
cash-drunk euphoria not seen since the heady days before the dotcoms
crashed. But it soon becomes apparent that something is not right at
ReBuilding Iraq 2. Sure, the organisers do the requisite gushing about
how "nonmilitary rebuilding costs could near $500bn" and that this is
"the largest government reconstruction effort since the US helped to
rebuild Germany and Japan after the second world war".



But for the undercaffeinated crowd staring uneasily at exploding garbage
cans, the mood is less gold rush than grim determination. Giddy talk of
"greenfield" market opportunities has been supplanted by sober
discussion of sudden-death insurance; excitement about easy government
money has given way to controversy about foreign firms being shut out of
the bidding process; exuberance about CPA chief Paul Bremer's
ultraliberal investment laws has been tempered by fears that those laws
could be overturned by a directly elected Iraqi government.



At ReBuilding Iraq 2, held last December, it seems finally to have
dawned on the investment community that Iraq is not only an "exciting
emerging market", it's also a country on the verge of civil war. As
Iraqis protest about layoffs at state agencies and make increasingly
vocal demands for general elections, it's becoming clear that the White
House's prewar conviction that Iraqis would welcome the transformation
of their country into a free-market dream state may have been just as
off-target as its prediction that US soldiers would be greeted with
flowers. I mention to one delegate that fear seems to be dampening the
capitalist spirit. "The best time to invest is when there is still blood
on the ground," he assures me.



"Will you be going to Iraq?" I ask.



"Me? No, I couldn't do that to my family." He was still shaken, it
seemed, by the afternoon's performance by ex-CIAer John MacGaffin, who
had harangued the crowd like a Hollywood drill sergeant. "Soft targets
are us!" he bellowed. "We are right in the bull's-eye ... You must put
security at the centre of your operation!" Lucky for us, MacGaffin's own
company, AKE Group, offers complete counterterrorism solutions, from
body armour to emergency evacuations.



Youssef Sleiman, managing director of Iraq Initiatives for the Harris
Corporation, has a similarly entrepreneurial angle on the violence. Yes,
helicopters are falling, he says, but "for every helicopter that falls
there is going to be replenishment".



I notice that many delegates are sporting a similar look: army-issue
brush cuts paired with dark business suits. The guru of this gang is
retired Major General Robert Dees, freshly hired out of the military to
head Microsoft's "defence strategies" division. Dees tells the crowd
that rebuilding Iraq has special meaning for him because, well, he was
one of the people who broke it. "My heart and soul is in this because I
was one of the primary planners of the invasion," he says with pride.
Microsoft is helping to develop "e-government" in Iraq, which Dees
admits is a little ahead of the curve, since there is no g-government in
Iraq, not to mention functioning phone lines.



No matter. Microsoft is determined to get in on the ground floor. In
fact, it is so tight with Iraq's governing council that one Microsoft
executive, Haythum Auda, was the official translator for the council's
minister of labour and social affairs, Sami Azara al-Ma'jun, at the
conference. "There is no hatred against the coalition forces at all,"
al-Ma'jun says, via Auda. "The destructive forces are very minor and
these will end shortly ... Feel confident in rebuilding Iraq!"



The speakers on a panel about managing risks have a very different
message, however: feel afraid about rebuilding Iraq, very afraid. Unlike
previous presenters, their concern is not the obvious physical risks,
but the potential economic ones. These are the insurance brokers, the
grim reapers of Iraq's gold rush.



It turns out that there is a rather significant hitch in Bremer's bold
plan to auction off Iraq while it is still under occupation: the
insurance companies aren't going for it. Until recently, the question of
who would insure multinationals in Iraq has not been pressing. The major
reconstruction contractors such as Bechtel are covered by USAID for
"unusually hazardous risks" encountered in the field. And Halliburton's
pipeline work is covered under a law passed by Bush last May that
indemnifies the entire oil industry from "any attachment, judgment,
decree, lien, execution, garnishment, or other judicial process".



But with bidding now starting on Iraq's state-owned firms, and foreign
banks ready to open branches in Baghdad, the insurance issue is suddenly
urgent. Many of the speakers admit that the economic risks of going into
Iraq without coverage are huge: privatised firms could be
renationalised, foreign ownership rules could be reinstated and
contracts signed with the CPA could be torn up. Normally,
multi-nationals protect themselves against this sort of thing by buying
"political risk" insurance. Before he got the top job in Iraq, this was
Bremer's business - selling political risk, expropriation and terrorism
insurance at Marsh & McLennan Companies, the largest insurance brokerage
firm in the world. Yet, in Iraq, he has overseen the creation of a
business climate so volatile that private insurers, including his old
colleagues at Marsh & McLennan, are simply unwilling to take the risk.
Bremer's Iraq is, by all accounts, uninsurable.



"The insurance industry has never been up against this kind of exposure
before," R Taylor Hoskins, vice-president of Rutherford International
insurance company, tells the delegates apologetically. Steven Sadler,
managing director and chairman at Marsh Industry Practices, a division
of Bremer's old firm, is even more downbeat: "Don't look to Iraq to find
an insurance solution. Interest is very, very, very limited. There is
very limited capacity and interest in the region."



It's clear that Bremer knew Iraq wasn't ready to be insured: when he
signed Order 39, opening up much of its economy to 100% foreign
ownership, the insurance industry was specifically excluded. I ask
Sadler, a Bremer clone with slicked-back hair and bright red tie,
whether he thinks it's strange that a former Marsh & McLennan executive
could have so overlooked the need for investors to have insurance before
they enter a war zone. "Well," he says, "he's got a lot on his plate."
Or maybe he just has better information.



Just when the mood at ReBuilding Iraq 2 couldn't sink any lower, up to
the podium strides Michael Lempres, vice-president of insurance at the
Overseas Private Investment Corporation (OPIC). With a cool confidence
absent from the shellshocked proceedings so far, he announces that
investors can relax: Uncle Sam will protect them. A US government
agency, OPIC provides loans and insurance to US companies investing
abroad. And while Lempres agrees with earlier speakers that the risks in
Iraq are "extraordinary and unusual", he also says that "OPIC is
different. We do not exist primarily to generate profit." Instead, OPIC
exists to "support US foreign policy". And since turning Iraq into a
free-trade zone is a top Bush policy goal, OPIC will be there to help
out. Earlier that same day, Bush signed legislation providing "the
agency with enhancements to its political risk-insurance programme",
according to an OPIC press release.



Armed with this clear political mandate, Lempres announces that the
agency is now "open for business" in Iraq, and is offering financing and
insurance, including the riskiest insurance of all: political risk.
"This is a priority for us," he says. "We want to do everything we can
to encourage US investment in Iraq." The news, as yet unreported,
appears to take even the highest-level delegates by surprise. After his
presentation, Lempres is approached by Julie Martin, a political risk
specialist at Marsh & McLennan.



"Is it true?" she demands.



Lempres nods. "Our lawyers are ready."



"I'm stunned," says Martin. "You're ready? No matter who the government
is?"



"We're ready," Lempres replies. "If there's an expro[priation] on
January 3, we're ready. I don't know what we're going to do if someone
sinks $1bn into a pipeline and there's an expro." Lempres doesn't seem
too concerned about these possible "expros", but it's a serious
question. According to its official mandate, OPIC works "on a
self-sustaining basis at no net cost to taxpayers". But Lempres admits
that the political risks in Iraq are "extraordinary". If a new
government expropriates and re-regulates across the board, OPIC might
have to compensate dozens of US firms for billions of dollars in lost
investments and revenues, possibly tens of billions. What happens then?



At the Microsoft-sponsored cocktail reception in the Galaxy Ballroom
that evening, Dees urges us "to network on behalf of the people of
Iraq". I follow orders and ask Lempres what happens if "the people of
Iraq" decide to seize back their economy from the US firms he has so
generously insured. Who bails out OPIC? "In theory," he says, "the US
treasury stands behind us." That means the US taxpayer. Yes, them again:
the same people who have already paid Halliburton, Bechtel et al to make
a killing on Iraq's reconstruction would have to pay them again, this
time in compensation for their losses. While the vast profits being made
in Iraq are strictly private, it turns out that the entire risk is being
shouldered by the public.



For the non-US firms in the room, OPIC's announcement is anything but
reassuring: since only US companies are eligible for its insurance, and
the private insurers are sitting it out, how can they compete? The
answer is that they likely cannot. Some countries may decide to match
OPIC's Iraq programme. But, in the short term, not only has the US
government barred companies from non-"coalition partners" from competing
for contracts against US firms, it has made sure that the foreign firms
that are allowed to compete will do so at a serious disadvantage.



The reconstruction of Iraq has emerged as a vast protectionist racket, a
neo-con New Deal that transfers limitless public funds - in contracts,
loans and insurance - to private firms, and even gets rid of the foreign
competition to boot, under the guise of "national security". Ironically,
these firms are being handed this corporate welfare so they can take
full advantage of CPA-imposed laws that systematically strip Iraqi
industry of all its protections, from import tariffs to limits on
foreign ownership. Michael Fleisher, head of private-sector development
for the CPA, recently explained to a group of Iraqi businesspeople why
these protections had to be removed. "Protected businesses never, never
become competitive," he said. Quick, somebody tell OPIC and US deputy
secretary of defence Paul Wolfowitz.



The issue of US double standards comes up again at the conference when a
CPA representative takes the podium. A legal adviser to Bremer, Carole
Basri has a simple message: reconstruction is being sabotaged by Iraqi
corruption. "My fear is that corruption will be the downfall," she says
ominously, blaming the problem on "a 35-year gap in knowledge" in Iraq
that has made Iraqis "not aware of current accounting standards and
ideas on anti-corruption". Foreign investors, she adds, must engage in
"education, bring people up to world-class standards". It's hard to
imagine what world-class standards she's referring to, or who, exactly,
will be doing this educating. Halliburton, with its accounting scandals
back home and its outrageous overbilling for gasoline in Iraq? The CPA,
with its two officers under investigation for bribe-taking and
nonexistent fiscal oversight?



On the final day of ReBuilding Iraq 2, the front- page headline in our
complimentary copies of the Financial Times (a conference sponsor) is
Boeing Linked To Perle Investment Fund. Perhaps Richard Perle, who
supported Boeing's $18bn refuelling-tanker deal and extracted $20m from
Boeing for his investment fund, can teach Iraq's politicians to stop
soliciting "commissions" in exchange for contracts.



For the Iraqi expats in the audience, Basri's is a tough lecture to sit
through. "To be honest," says Ed Kubba, a consultant and board member of
the American Iraqi Chamber of Commerce, "I don't know where the line is
between business and corruption." He points to US companies
subcontracting huge taxpayer-funded reconstruction jobs for a fraction
of what they are getting paid, then pocketing the difference. "If you
take $10m from the US government and sub the job out to Iraqi businesses
for a quarter-million, is that business, or is that corruption?"



These were the sorts of uncomfortable questions faced by George Sigalos,
director of government relations for Halliburton KBR. In the hierarchy
of Iraqi reconstruction, Halliburton is king, and Sigalos sits on stage,
heavy with jewelled ring and gold cufflinks, playing the part. But the
serfs are getting restless, and the room quickly turns into a support
group for jilted would-be subcontractors: "Mr Sigalos, what are we going
to have to do to get some subcontracts?"



"Mr Sigalos, when are you going to hire some Iraqis in management and
leadership?"



"I have a question for Mr Sigalos. I'd like to ask what you would
suggest when the army says, 'Go to Halliburton', and there's no response
from Halliburton?"



Sigalos patiently tells them all to register their firms on
Halliburton's website. When they respond that they have already done so
and haven't heard back, he invites them to "approach me afterward".



The scene afterwards is part celebrity autograph session, part riot.
Sigalos is swarmed by at least 50 men who elbow each other out of the
way to shower the Halliburton VP with CD-roms, business plans and
résumés. When Sigalos spots a badge from Volvo, he looks relieved.
"Volvo! I know Volvo. Send me something about what you can achieve in
the region." But the small, no-name players who have paid their $985
entrance fees, here to hawk portable generators and electrical control
panelling, are once again told to "register with our procurement
office". There are fortunes being made in Iraq, but it seems they are
out of reach for all but the chosen few.



The next session is starting and Sigalos has to run. The serfs wander
off through the displays of shatterproof glass and bomb-resistant trash
cans, caressing Sigalos's business card and looking worried.
I 

Sean






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